R (Members of the Committee of Care North East Northumberland) v Northumberland CC
14.29R (Members of the Committee of Care North East Northumberland) v Northumberland CC [2013] EWCA Civ 1740, (2014) 17 CCLR 117
Local authorities are entitled to choose how to assess local care costs and what level of enquiry to undertake, subject to rationality
Facts: Northumberland set its standard fee rates for residential accommodation, not by an exercise of precise quantification but by exercising judgment and experience in the light of how the market functioned locally, also taking into account the fees being paid elsewhere; and around 70 per cent of local providers agreed to make provision on that basis. Others however brought a judicial review, submitting that Northumberland’s methodology was flawed, with the result that it had not properly taken into account the usual cost of providing care home accommodation locally.
Judgment: the Court of Appeal (Aikens and Sullivan LJJ, Sir Stanley Burnton) held that the relevant central government guidance did not prescribe any particular methodology and, in principle, so long as a public authority took some steps to equip itself with relevant information, it was generally for the authority to decide on the manner and intensity of the inquiry to be undertaken. On the facts of this case, the judge at first instance had been plainly correct to conclude that Northumberland had regard to the cost of providing care locally. Judges at first instance had been prepared to delve into the facts to a surprising degree given that these were judicial review proceedings and such cases ought to be regarded as turning on their own facts.
Sullivan LJ said this:
17. The circular contains guidance. It is not to be equated with a statutory duty imposed by an enactment and as would be expected in the case of guidance, it does not prescribe any particular methodology, whether ‘structured’ or otherwise which local authorities must adopt in order to have had ‘due regard’ to the actual costs of providing care.
18. The claimants’ submission, that as a matter of law a ‘structured’ approach (whatever that may mean, see below) is required, treats a single sentence in guidance in a circular as though it was a duty imposed by primary legislation. When we asked Ms Mountfield what the defendant had failed to do which it was under a duty to do as a matter of law, her reply was that the defendant had not focused on the question of actual cost and had failed to make a ‘sufficient inquiry’ contrary to the well established principle that a decision-maker must ‘ask himself the right question and take reasonable steps to acquaint himself with the relevant information to enable him to answer it correctly’: see Secretary of State for Education and Science v Tameside Metropolitan Borough Council [1977] AC 1014, 1065, per Lord Diplock.
19. The emphasis in Ms Mountfield’s submissions was on the sufficiency of the defendant’s inquiries. There is no dispute that the defendant took some steps to equip itself with the relevant information. The claimants’ contention is that those steps were insufficient. When considering the force of this submission, it is important to remember that, provided some inquiry into the relevant factor to which due regard has to be paid is made by the decision-maker, ‘it is generally for the decision-maker to decide on the manner and intensity of the inquiry to be undertaken into any relevant factor’: see per Beatson J in R (Bevan & Clarke LLP) v Neath Port Talbot County Borough Council [2012] LGR 728 para 56 cited in para 37 of the judgment below [2013] PTSR 1130.
20. The submission that there had been insufficient inquiry was coupled with a submission that the underlying fault in the defendant’s approach was that it did not focus on ascertaining the actual cost of providing care because it never asked the correct question of the claimants, ‘what are your actual costs of providing care?’, and instead asked them the wrong question, ‘why are you not able to provide care at the lower fee levels being paid by neighbouring local authorities in the north east?’
21. There are two answers to that submission: first, it does not accord with the judge’s factual conclusions in paras 39–44 of the judgment as to what the defendant actually did, against which there was no challenge in the grounds of appeal. Secondly, in any event, the difference between the two questions is a matter of semantics rather than substance. Looking at these two answers in turn, I will not repeat the details of the judge’s factual findings which can be found in paras 39–44 of his judgment. In summary, the judge found that the defendant had: (i) considered to what extent its existing rates of payment were leading to overcapacity in the market in its area; (ii) compared its own rates with those being paid by other local authorities in the region and considered whether there was anything to explain why the cost of providing care in Northumberland should be materially higher than elsewhere in the region; (iii) taken account of the position of those providers with whom it was able to reach agreement and the evidence that they had provided as to how they had determined that the proposed rates would enable them to meet the actual costs of care; (iv) sought information from the claimants and, when management accounts were provided by one of the members of CNEN, Mr McArdle, who had sought to explain why the provision of care in Northumberland costs more than elsewhere, carefully considered those accounts; (v) explained why it did not think it appropriate to accede to the claimants’ request to use the PricewaterhouseCoopers (‘PwC’) model before calculating its ‘usual costs’.
22. On the basis of those factual findings as to the steps that were taken by the defendant to acquaint itself with the relevant information, the judge’s conclusion that the defendant did have ‘due regard’ to the actual costs of care as required by the circular was plainly correct. In reaching that conclusion the judge followed the approach adopted by Singh J in R (South West Care Homes Ltd) v Devon County Council [2012] EWHC 1867 (Admin): see the judgment below [2013] PTSR 1130 para 37.